Bulgaria’s Labor Perpetually in Crisis

Cross-posted from JohnFeffer.com. John is currently traveling in Eastern Europe and observing its transformations since 1989.

In the early 1990s, I helped put together a delegation on the topic of women and workplace in East-Central Europe. Several U.S. groups invited the delegation to the United States, with support from the German Marshall Fund, to meet with women’s organizations, trade unions, and a variety of Washington-based organizations.

It was not an easy task to identify women for the delegation. Many unions wanted to just pick the participants and didn’t understand my request for several candidates and their CVs. Also, there were two types of unions in the region: former official unions and new unions affiliated in some way with the political opposition. In those days, they didn’t get along very well. The U.S. government, and most U.S. organizations, only worked with the independent unions. So, it was challenging to put together a delegation with representatives of both sides.

I pushed hard to include representatives from the former official unions. As I wrote in a 1993 report, “The former communist trade unions have been doing a reasonably good job of democratizing themselves, and they still command the lion’s share of workers’ support. This despite several years of money and effort on the part of the AFL-CIO and the U.S. government to strengthen the ‘alternative’ unions. Now the international unions are having to adjust their strategies and open doors to the very unions they initially spurned.”

It seemed like the people who might benefit the most from a trip to the United States would be representatives from these former official trade unions. And it would have been educational, to say the least, for U.S. trade unions and government staff to meet with “the other side.” But for a mixture of external and internal reasons, a mixed delegation didn’t happen.

Still, I learned a great deal from my meetings at these former official unions. Some of the best discussions that I had on these topics, for instance, were at the Confederation of Independent Trade Unions (CITUB) in Sofia, thanks to the help of Snezhana Dimitrova who was working with the international affairs division.

Twenty-three years later, I returned to the CITUB building and met in her office. CITUB still owns a big building in the center of Sofia. But whereas many other offices in Bulgaria’s capital have been remodeled and modernized, the CITUB building has none of the fancy furniture and outfitting that USAID recipients enjoy. It looks much as it did during the communist period, though without the bustle or the security. There was no guard in the booth in the lobby on the day I visited, and I pushed through the turnstile without having to announce myself.

Indeed, it has not been an easy time for CITUB. It has seen its membership base decline from 2.5 million to 300,000. However, it is still by far the largest union confederation.

“We no longer have heavy industry in Bulgaria,” Snezhana Dimitrova explained to me as a major reason for the decline in membership. “There are still union members in the big cities, where there is work. Also, it’s very difficult for workers at small enterprises to organize, because they’re afraid they’ll lose their jobs.”

The economic reforms, from a trade union perspective, were largely disastrous. “From 1991, controls on prices were removed and industry was privatized,” she continued. “Collective farms were dissolved. A new constitution was introduced in July 1991. Economic reform started off in the wrong way. For example, agriculture was destroyed. Now they are saying that they made a mistake when they destroyed the cooperatives. They also didn’t privatize the right way. When they privatized and sold off the enterprises and the machinery, we lost many enterprises and many many jobs. The chemical industry, the Kremikovtsi steel complex, heavy industry in general: everything was destroyed.”

We also talked about the relationship between CITUB and the other major trade union organization (Podkrepa), the role of strikes, and the economic prospects for Bulgaria. Economic crisis in Europe? “Here in Bulgaria,” Snezhana Dimitrova told me, “we say that we are not feeling the crisis because we’ve always been in crisis.”

The Interview

Can you tell me how you got involved in your current work at the union?

After university, I started as a translator in the international department of the Trade Union School because my languages are Slavic: Czech and Russian. At that time, we had a lot of contacts with trade unions in Slavic countries – Czechoslovakia, Poland, Russia – so I had a lot of work then. After that, I started to learn English, because we had a trade union school with many people coming from Latin America, United States, United Kingdom, Australia. Because I was in the international department, I started to translate English too, but my English is not fluent.

The transformation of society begins with trade unions. We had a lot of contacts with friends in the United States, from Western countries, and we began to have exchanges with them. We had a lot of groups from the West, like British coal miners, who were having a lot of problems with the Thatcher government because it was cutting jobs. It was interesting to work here at that time because of these contacts. There was more freedom. It wasn’t like in the Center of the Communist Party, which was much stricter.

The Institute for Social and Trade Union Research (ISTUR) is a research institute at the Confederation of Independent Trade Unions (CITUB) in Bulgaria. CITUB is the successor to the 100-year union tradition. The Confederation brings together 35 federations, trade unions, and associations and a number of associate members.The main subject area for ISTUR is to analyze the processes associated with social and economic reforms in Bulgaria in the transition to a market economy and prospects for trade union policy and industrial relations. Research is being conducted at three levels: theoretical, applied and as ordered by public organizations.

The Institute employs 12 researchers representing different specialties: economics, sociology, political science, psychology, and computer science.. ISTUR maintains a network of outside contacts with relevant research institutions, universities, social partner organizations, state administration, and NGOs. Now we are only 12 people, so I have to do a lot of work. I’m the national coordinator of Eurofound, the librarian of our small collection of books, and I also translate.

CITUB was the only trade union for a long time. And then Podkrepa began in the late 1980s. What was the relationship like between the two union confederations?

Podkrepa started out very well. It was a new trade union. It was accepted by the population as a break from the old. Many of the trade unions in our confederation went over to Podkrepa. I couldn’t say why. We have a very wise leadership here.

I expected one large trade union to emerge here in Bulgaria, but that didn’t happen. All the time we were the largest trade union organization, but of course the membership is not the same as in 1989. We are the better trade union than Podkrepa. I can’t say why they lost their initial advantage. I suppose maybe it’s poor leadership. They had everything. They were new. They were supported by western countries. They received material support.

But we remain the largest. We have about 300,000 members. Podkrepa has 60,000. In 1989, our membership was 2.5 million, because membership was obligatory. All workers had to be members of trade unions.

In the beginning, because CITUB was thinking in terms of the old-style trade unions, the relationship with Podkrepa was not good. Now, with compromises by both sides, it is good. Over the last 10 years, we’ve coordinated our strikes with Podkrepa, and they’ve coordinated theirs with us.

CITUB has proven that it is a new organization with new vision. Our leader is a relatively young man: Plamen Dimitrov. He started activity in trade unions as Varna district coordinator, executive secretary of CITUB, and vice president of CITUB.

Why has there been such a big decline in union membership?

We no longer have heavy industry in Bulgaria. There are still union members in the big cities, where there is work. Also, it’s very difficult for workers at small enterprises to organize, because they’re afraid they’ll lose their jobs.

Bulgarian workers are losing jobs, and they have lower pay. Compared to other European countries, we are at the bottom in terms of wages. Also, pensions are very small. If pensioners didn’t live with their families, they couldn’t pay for electricity and heating.

As a trade union, CITUB attaches great importance to collective bargaining as an essential tool for the effective protection of the rights and interests of employees. Since 1995, CITUB is a member of the European Trade Union Confederation, which is an institutional partner of the European Commission. Representatives of CITUB participate actively in the work of the European Economic and Social Council.

In Bulgaria, we have many trade union organizations. The labor code defines the criteria for trade union representativeness at national, branch, and sectoral levels. According to this labor code , only Podkrepa and CITUB are national representatives of workers. Other trade union organizations are present only at the enterprise level. They can’t negotiate at the national level. This kind of trade union has no power. Wages more often depend on the ministry, at the national level. Because of that, it is necessary to have a bigger trade union that can negotiate with the ministers. But still, more aggressive and more charming union leaders are appearing at the enterprise level, perhaps because they are not satisfied with either CITUB or Podkrepa.

Have there been a lot of strikes?

There were many strikes, especially between 1991 and 1993. There were meetings, rallies, political strikes, economic strikes. And sometimes the government resigned because of the strikes. After this political turmoil, they strike only for wages, to improve working conditions. They strike because they don’t want to lose their jobs if the enterprise closes. You can read about every strike at Eurofound, where we are the correspondent for Bulgaria. You can read about what happened, the results, and who was the leader, whether CITUB, Podkrepa, or another organization.

Have there been any particularly successful strikes?

The railways wanted to stop increasing wages. They threatened to cut jobs. Both CITUB and Podkrepa negotiated with the management. We had a strike. Now the railways make reforms but without cutting jobs, and they even increased the wages a little bit.

How would you evaluate the economic reforms that have taken place here in Bulgaria?

From 1991, controls on prices were removed and industry was privatized. Collective farms were dissolved. A new constitution was introduced in July 1991. Economic reform started off in the wrong way. For example, agriculture was destroyed. Now they are saying that they made a mistake when they destroyed the cooperatives. They also didn’t privatize the right way. When they privatized and sold off the enterprises and the machinery, we lost many enterprises and many many jobs. The chemical industry, the Kremikovtsi steel complex, heavy industry in general: everything was destroyed.

Sold to whom?

Most enterprises were sold to domestic buyers. But Balkan Airlines was sold to foreigners and then closed down. We are now without an airline. We had access rights in airports in London, Vienna, Paris. But we’ve lost those rights. I fly now only with Turkish airlines.

Are there any positive signs economically?

They are now developing the tourist industry. And agriculture has started again. The agricultural produce grown here is a hundred times better than what we are buying from Macedonia, Greece, and Turkey.

Are there positive signs for growth in union membership?

There is no potential for growth. This is normal, not to be a big organization. It’s better to be a strong organization, to organize people whether they are members or not. If we negotiate something for a branch, the deal is valid for all people working in the branch, not just the members of trade union organizations. It’s better to give all the people the possibility to increase wages and not just your trade union members. It’s easier at the national level to negotiate with the minister to increase the wages for all branches, for all enterprises.

Where would you put CITUB along the political spectrum?

Normally, trade unions are closer to the left wing. But here in Bulgaria, I couldn’t say. First, the trade union supported the economic reforms, and the reforms were made by the right wing. That meant that we supported the right-wing party. But then CITUB decided to be an independent trade union and not to support a particular party. Now, the union supports the party that has programs similar to ours in terms of economic development, wages, and jobs. Now we support the party that wants to increase wages and create new jobs.

All parties are the same. They implement only a small part of their programs. Most people don’t believe in the parties. Only the people on the left and the right vote for particular parties. Most people don’t vote. They don’t know whom to choose.

The current government is popular. The leader speaks with ordinary people. He makes jokes. Women like him: not me, but other women.

How do you evaluate the future prospects for Bulgaria?

I can’t see anything positive. Most young people want to work abroad. For example, the young people who win the medals from math or science Olympiads, when they return to Bulgaria, they get offers from American or British universities to study there. And they agree immediately, without thinking that they could study and work here.

A friend of mine told his children to stay where they are. One is in Belgium, the other in France. Mothers don’t want their children to come back here: because it is difficult to get a job, especially a job with a good salary, even for people who are educated. As for people in the villages, there aren’t any jobs, good or otherwise.

What about foreign investment?

Everybody knows that it’s good to attract foreign capital. We have no capital. We are not a rich country. Only the trade unions can protect the rights of workers in this situation. If foreign investors want to cut jobs, the trade unions negotiate how many and and under what conditions. We negotiate so that they pay six months of wages, and we make sure that pensioners get their pensions.

Can you explain the pension situation here?

The minimum retirement age in Bulgaria has been increased by 4 months as of Sunday, January 1, 2012, as part of a controversial retirement reform package. The same measure will be applied on the first day of each of the upcoming several years until the retirement age in Bulgaria reaches 65 years for men and 63 for women. Up until the new pension reform was approved in December 2011, Bulgaria’s retirement age was 63 years for men and 60 years for women.

There are three kinds of pensions: the government pension fund, an obligatory fund for people born after 1960, and private pension funds. In terms of the private pension fund, you can pay into this fund for an additional pension. The employer can also pay for an additional pension to the worker, particularly if the trade union negotiates this arrangement. In the beginning, this private fund was interesting because it was very new. It was also important because the government pensions in Bulgaria were very low. The trade union believed that it was important to have this additional pension, especially if the employer was paying into it.

What kind of international cooperation do you now have at CITUB?

For instance, at ISTUR we are working with Turkish trade unions with women in trade unions there on career development. This project, led by Italians, has EU funding, and we participate as lecturers.

How do you feel about Bulgaria’s own membership in the EU?

I am optimistic about Europe. I still think that membership is a good thing. But I think that most people here had high expectations that wages would increase automatically and everything here would be closer to the living standard for Europe. That didn’t happen, so they are disappointed.

We lost our former markets in the region. Russia was a big market. It accepted everything that we produced. Now with the EU, we can’t sell them our products in the same way. So, it’s quite difficult.

People in Europe talk about the economic crisis. But here in Bulgaria, we say that we are not feeling the crisis because we’ve always been in crisis.